Home' Trinidad and Tobago Guardian : February 5th 2014 Contents A21
Wednesday, February 5, 2014 www.guardian.co.tt Guardian
Nadella, an executive in charge of the com-
pany s small, but growing business of deliv-
ering software and services over the Internet,
as its new CEO. Company founder Bill Gates
is leaving the chairman role for a new role
as technology adviser.
The software company announced yest-
werday that Nadella will replace Steve Ballmer,
who said in August that he would leave the
company within 12 months. Nadella will
become only the third leader in the software
giant s 38-year history, after Gates and Ballmer.
Board member John Thompson will serve as
Microsoft s new chairman.
Indian-born Nadella, who is 46 and has
worked at Microsoft for 22 years, has been an
executive in some of the company s fastest-
growing and most-profitable businesses,
including its Office and server and tools busi-
For the past seven months, he was the exec-
utive vice president who led Microsoft s cloud
computing offerings. That s a new area for
Microsoft, which has traditionally focused on
software installed on personal computers rather
than on remote servers connected to the Inter-
net. Nadella s group has been growing strongly,
although it remains a small part of Microsoft s
"Satya is a proven leader with hard-core
engineering skills, business vision and the
ability to bring people together," Gates said in
a statement. "His vision for how technology
will be used and experienced around the world
is exactly what Microsoft needs as the company
enters its next chapter of expanded product
innovation and growth."
The company said that Gates, in his new
role as founder and technology adviser, "will
devote more time to the company, supporting
Nadella in shaping technology and product
Gates will also remain a member of
Microsoft s board.
Analysts hope that Nadella can maintain
the company s momentum in the rapidly
expanding field of cloud computing while
minimising the negative impact from
Microsoft s unprofitable forays into consumer
hardware. Major rivals in cloud computing
include Google Inc, Amazon.com Inc, Sales-
force.com Inc and IBM Corp.
FBR Capital Markets analyst Daniel Ives
said he views Nadella as a "safe pick".
Ives said investors are worried that rivals
"from social, enterprise, mobile, and the tablet
segments continue to easily speed by the com-
pany". In a note to investors, he said the com-
pany s main need now is "innovation and a
set of fresh new strategies to drive the next
leg of growth".
Microsoft shares rose 15 cents to US$36.63
in morning trading yesterday.
Nadella s appointment comes at a time of
turmoil for Microsoft.
Founded in April 1975 by Gates and Paul
Allen, the company has always made software
that powered computers made by others---
first with its MS-DOS system, then with Win-
dows and its Office productivity suite starting
in the late 1980s. Microsoft s coffers swelled
as more individuals and businesses bought
But Microsoft has been late adapting to
developments in the technology industry. It
allowed Google to dominate in online search
and advertising, and it watched as iPhones,
iPads and Android devices grew to siphon
sales from the company s strengths in personal
computers. Its attempt to manufacture its own
devices has been littered with problems, from
its quickly aborted Kin line of phones to its
still-unprofitable line of Surface tablets.
Analysts see hope in some of the businesses
Nadella had a key role in creating.
Microsoft s cloud computing offering, Azure,
and its push to have consumers buy Office
software as a US$100-a-year Office 365 sub-
scription are seen as the biggest drivers of
Microsoft s growth in the next couple of years.
Both businesses saw the number of customers
more than double in the last three months of
the year, compared with a year earlier.
Those businesses, along with other back-
end offerings aimed at corporate customers,
are the main reason why investment fund Val-
ueAct Capital invested US$1.6 billion in
Microsoft shares last year.
Nadella is a technologist, fulfilling the
requirement that Gates set out at the com-
pany s November shareholder meeting, where
the Microsoft chairman said the company s
new leader must have "a lot of comfort in
leading a highly technical organisation".
Born in Hyderabad, India, in 1967, Nadella
received a bachelor s degree in electrical engi-
neering from Mangalore University, a master s
degree in computer science from the University
of Wisconsin, Milwaukee, and a master s of
business administration from the University
He joined Microsoft in 1992 after being a
member of the technology staff at Sun
One of his first tasks will be integrating
Nokia s money-losing phone and services
business. Microsoft agreed in September to
buy that and various phone patent rights for
5.4 billion euros (US$7.3 billion) in one of
Ballmer s last major acts as CEO. That deal
is expected to be completed by the end of
Partly because of Nadella s insider status
and the fact that both Gates and Ballmer will
remain Microsoft s largest shareholders and
for now, company directors, analysts aren t
expecting a quick pivot in the strategy of mak-
ing its own tablets and mobile devices.
Some hope, however, that he will make big
changes that will help lift Microsoft stock,
which has been stuck in the doldrums for
more than a decade. Since Ballmer took office
in January 13, 2000, Microsoft shares are down
a split-adjusted 32 per cent, compared with
a 20 per cent gain in the S&P 500. (AP)
In this May 21, 2008 photo, Satya Nadella
demonstrates some of the features of
Live Search on a mobile device during the
advance08 Advertising Leadership
Forum at the company's campus in
Redmond, Washington. Microsoft
announced yesterday that Nadella will
replace Steve Ballmer as its new CEO.
Board member John Thompson will serve
as Microsoft's new chairman. AP PHOTO
Microsoft founder Bill Gates
Satya Nadella succeeds Bill Gates and Steve
Ballmer as CEO of Microsoft.
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